Local talent rises through ranks in foreign enterprises

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Last updated at: (Beijing Time) Thursday, December 18, 2003

Local talent rises through ranks in foreign enterprises

A new generation of Chinese managers are gradually taking over the upper echelons of foreign enterprises in China, where local faces were a rarity until recent times.

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A new generation of Chinese managers are gradually taking over the upper echelons of foreign enterprises in China, where local faces were a rarity until recent times.

"Chinese have become the major work force of foreign and multinational companies in China," said Wang Yi'e, general manager of the Beijing Foreign Enterprises Human Resources Service Co., Ltd..

Nine of the 12 general managers and presidents of Ericsson (China) Company Ltd. are locals and 21 of its 25 department heads are Chinese.

European, Japanese and Korean firms, which have been slow to introduce locals, have also begun to recruit Chinese in their high management level.

"Localization of talent is essential for foreign enterprises," said Wang. The number of Chinese hired by foreign firms through Wang's company, the largest human resources service company in Beijing, is increasing by 10,000 every year.

The world's largest retailer, Wal-Mart, has more than 16,000 employees in China, 99 percent of whom are local and almost all its stores have Chinese managers.

Motorola (China) Electronics Co. Ltd., the largest foreign electronics firm in China, has increased its percentage of local management staff from 11 percent in 1994 to 83.3 percent.

"Localization of talent is the basis for Motorola China to make great achievements," said Cindy Xing, the company's human resources chief manager.

A survey released by the America-China Commission of Commercialand Trade Development shows that multinational and foreign companies in China have a 90 percent local staff ratio on average with the level of local managers at over 95 percent.

Cheap labor was the main reason foreign enterprises chose localstaff, said Wang Yi'e. A local employee's salary could be a fraction of his foreign counterpart's. Firms also had to cover theliving expenses of foreign employees' families and their children's education.

With China's opening up and its development, Chinese had improved their skills and many had mastered other languages. Foreign companies had also trained local staff, said Wang.

Many managers in public relations, law, and marketing in foreign enterprises are now Chinese. "They are more familiar with the local culture and can help the company adapt," said Joe Hatfield, president of Wal-Mart Asia.

Du Limin started her career as an ordinary checkout person at Wal-Mart. Two years later, she is general manger of a Sam Club in Shenzhen. Now, the 30-year-old woman manages four Sam Clubs.

"The biggest asset of Wal-Mart in China is its superb local staff and they are the driving force of Wal-Mart's development in China," said Hatfield.

However, with the increasing demand of foreign enterprises for local, Chinese talents structures appear to still need work. "A lack of senior managers and technology workers has become the biggest problem for foreign enterprises in employment," said Wang.

Last month, at a large-scale talent fair in east China's Anhui province, the position of regional manager with an annual salary of 500,000 yuan (more than 60,000 US dollars) was offered by an American company that failed to find a qualified candidate, while 90 percent of the positions at the fair were filled.

Meanwhile, foreign firms are facing a shortage of general workers in China. Siemens China has to entrust Shanghai ElectronicIndustry School to train skilled workers for its factory for it could not find adequate qualified candidates in the human resources market.

Wang Yi'e said that it was also a hard job for his company to look for qualified technology workers.

"Our country's talent training structure should be adjusted according to actual demand to offer enough skilled people to meet the demand of foreign enterprise," said Wang.

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